The World Trade Organization agreed Monday to a request from Beijing to evaluate China's compliance with a ruling faulting it for unfair restrictions on imports of American grain.
The decision by the WTO's Dispute Settlement Body (DSB) to establish an expert panel to determine whether China complied with a 2019 ruling marks the latest twist in a long-running dispute between the world's two largest economies.
Back in December 2016, the administration of then US president Barack Obama filed a complaint with the global trade body over what it claimed were illegal Chinese restrictions on imports of American rice, wheat and corn, describing China's use of the so-called tariff-rate quota (TRQ) system as "opaque and unpredictable".
Washington estimated at the time that American farmers could have exported some $3.5 billion more of such crops to China if the system had been used properly, and charged that Beijing had violated its commitments under international trade rules.
A panel of experts established by the DSB agreed in April 2019 that China had failed to adhere to the commitments it made when it became a WTO member in 2001 to administer the TRQs on a "transparent, predictable, and fair basis".
TRQs are two-level tariffs, allowing for a limited volume of imports to come in at a lower "in-quota" tariff level, and all other imports charged at an often much higher "out-of-quota" tariff.
Countries like China that joined the WTO after its creation in 1995 have had their TRQ commitments set out in their accession agreements.
China maintains it has fully implemented the DSB rulings and recommendations in this dispute, but Washington does not agree, and threatened last month to take countermeasures.
China has requested that the WTO help settle the matter by establishing a fresh panel of experts to examine its compliance with the 2019 ruling.
Its initial request for a panel was rejected, but its second request during a DSB meeting Monday was granted, according to a Geneva-based trade official.
The US representative at Monday's meeting appeared to welcome the decision, saying Washington was "willing to work together with China to reach a resolution to this dispute".